Michigan lawmakers report some budget progress

Saturday

Sep 26, 2009 at 12:01 AMSep 26, 2009 at 12:52 PM

Majority Republicans in the Senate approved a temporary budget Friday to ensure state government keeps running in case a permanent spending plan isn’t in place within six days. But legislative leaders said they were making progress toward sealing a deal without the need for an interim budget.

David Eggert and TIM MARTIN

Majority Republicans in the Senate approved a temporary budget Friday to ensure state government keeps running in case a permanent spending plan isn’t in place within six days. But legislative leaders said they were making progress toward sealing a deal without the need for an interim budget.

Democratic House Speaker Andy Dillon said some of the toughest issues in the way of reaching a final deal to balance Michigan’s next state budget had been resolved.

“I’m very confident budgets will be resolved and passed by the deadline,” Dillon said just before the House adjourned Friday night.

Both the Democrat-led House and Republican-led Senate were to take Saturday off and resume budget votes Sunday aimed at eliminating a $2.8 billion budget shortfall by Oct. 1.

A key remaining hurdle was that Republicans had not promised to pass revenue or tax increases that Dillon said would be needed to preserve some of the Democrats’ high priority programs such as college scholarships and community health programs.

Dillon said he was confident those issues would be worked out in time to avoid a partial government shutdown or the need for an extension of Michigan’s current budget year. Dillon said the House would take revenue or tax increase votes next week, but he wouldn’t say which options he would put up for a vote.

A bottled water tax is among the options Democrats could propose. Other ideas include taxing estates worth more than $2 million, freezing a tax credit for low-income workers that is supposed to increase and assessing a 2 percent tax on doctors to get a 3-to-1 match in federal Medicaid dollars for the health care budget.

“There’s not a promise,” Dillon said when asked whether the Senate would pass the revenue. “But I’m confident it will get done and we’ll take care of our values.

Republican Senate Majority Leader Mike Bishop said he was “very optimistic” about a budget resolution after a Friday meeting with Dillon.